Big Basket receives $200 million in a round led by Alibaba

Online grocer Big Basket has closed its Series E financing of approximately Rs 1250 crore (about $200 million) in a round led by the Alibaba Group which also saw participation from existing shareholders including UAE-based private equity investor Abraaj Group, Sands Capital and International Finance Corporation, or IFC, as per the company’s regulatory filings with the Ministry of Corporate Affairs, sourced from data intelligence platform Paper.vc. 
 
The newly secured funds are going to help Big Basket compete with US-based Amazon and India’s Flipkart, both of which have significant money in their coffers and have forayed into the grocery space.
 
As per the company filings, Alibaba owns 14,60,000 shares of the Bengaluru-based company which is registered as Supermarket Grocery Supplies.
 
ET was the first to report in July that Alibaba and Paytm Mall were in talks with Big Basket to pour $200 million into the grocery company. While Paytm Mall has not invested in BigBasket, the two companies have entered into a "commercial aggreement" as a part of Alibaba's investment, according to one source familiar with the matter. Alibaba and it's payment affiliate Ant Financial own over 55% in Paytm Mall. 
 
This deal which had been in the works for around six months is expected to provide the Bengaluru-based company a post-money valuation of $850 million. The transaction will also include a secondary component of $80-100 million. 
 
The Chinese internet conglomerate Alibaba Group has been making a series of strategic investments in the Indian market in a bid to mirror the ecosystem they have created in China. The most recent one to get added to Alibaba’s roster of investments is logistics player XpressBees, which spun off from ecommerce company FirstCry. 
 
This series of investments in sectors like payments, ecommerce and logistics form the “iron triangle” of businesses as Alibaba’s founder Jack Ma calls it, which he believes can feed off each other. 
 
In China, the Alibaba Group has online retail businesses called Tmall (B2C, focusing on brands) and Taobao (C2C) and a payments business under affiliate Ant Financial, popularly known as Alipay. 
 
Big Basket, which was founded in 2011 by Hari Menon, Vipul Parekh, Abhinay Chaudhary and VS Sudhakar, was valued at $450 million during its last fundraising led by Abraaj Group. The company was also in discussions with Amazon for an investments but the talks did not materialise over issues, including valuation.
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